By Sarah Jones
Feb. 9 (Bloomberg) -- Stocks in Europe and Asia fell and U.S. futures declined after Treasury Secretary Timothy Geithner delayed the announcement of the Obama administration’s financial recovery plan and Nissan Motor Co. forecast a full-year loss.
Deutsche Bank AG and UBS AG slid more than 1.8 percent after U.S. officials debated proposals aimed at addressing the toxic debt clogging banks’ balance sheets. Nomura Holdings Inc. dropped the most in more than 34 years as Japan’s biggest brokerage said it may sell common stock to replenish capital. Renault SA, which owns 44.3 percent of Nissan, sank 2.1 percent.
Europe’s Dow Jones Stoxx 600 Index slipped 0.6 percent at 8:05 a.m. in London, leaving it with a 2009 loss of 0.5 percent. The MSCI Asia-Pacific Index decreased 0.4 percent, while Standard & Poor’s 500 Index futures dropped 1.3 percent.
U.S. equities last week snapped four weeks of declines on speculation the deteriorating economy would force Congress to reach a compromise on President Barack Obama’s economic stimulus package of about $800 billion. Officials said yesterday the delay in Geithner’s announcement was to allow the administration to focus on getting Senate approval of Obama’s fiscal stimulus.
“For the sake of the market, it’s very important we get the Obama stimulus package” through, said Philippe Gijsels, a Brussels-based senior structured-product strategist at Fortis Global Markets. We can expect bank earnings “to be very bad, there is very little visibility. It’s been a very bad overall earnings season which is still not quite over.”
European Earnings
Profits at 74 companies in the Stoxx 600 that reported results in 2009 fell 54 percent, Bloomberg data show. Analysts tracked by Bloomberg estimate that profits will slip 1.6 percent in 2009 after tumbling 20 percent last year.
The Stoxx 600 climbed last week as results at companies from Vodafone Group Plc to Electrolux AB beat estimates and governments stepped up efforts to ease the financial crisis that the International Monetary Fund predicts will cause global growth to almost grind to a halt this year.
Deutsche Bank, Germany’s largest bank, slid 1.8 percent to 21.14 euros while UBS, Switzerland’s biggest bank, lost 2.7 percent to 12.63 francs as U.S. officials debate the issue of illiquid assets that spurred the freeze in credit markets.
Officials are still considering a so-called bad bank to buy them, perhaps in cooperation with private investors, such as hedge funds and private equity. Some aspects of the plan, to be announced by Geithner tomorrow, have been settled, including a new round of injections of taxpayer funds into banks.
Fortis, Nomura
Fortis dropped 9.8 percent to 1.31 euros after Ping An Insurance (Group) Co. said it will reject the state-organized breakup of what was once Belgium’s largest financial-services firm.
Nomura tumbled 14 percent to 490 yen after saying it may sell as much as 300 billion yen ($3.3 billion) of common stock to replenish capital. Chief Executive Officer Kenichi Watanabe has failed to reassure investors with plans to cut costs and raise capital after posting four straight quarterly losses as tumbling stock markets eroded revenue.
Barclays added 3.7 percent to 108.7 pence. The bank said earnings fell less than 1 percent last year after 8.1 billion pounds ($12 billion) of asset writedowns.
Net income declined to 4.38 billion pounds, or 57.5 pence a share, from 4.42 billion pounds, or 66.7 pence, in 2007. That beat the mean estimate of 3.8 billion pounds from 12 analysts surveyed by Bloomberg.
Barclays said it won’t recommend a final dividend for 2008. The company plans to restart dividend payments in the second half of 2009.
Renault, Nissan
Renault fell 2.1 percent to 16.28 euros. Nissan, Japan’s third-largest automaker, predicted a full-year net loss of 265 billion yen ($2.91 billion) as the global recession cripples vehicle demand and a stronger yen cuts the value of earnings overseas. The carmaker said it will cut 20,000 jobs.
Separately, Les Echos reported the French government will today announce a loan of 6 billion euros ($7.8 billion) to be shared equally between Renault and PSA Peugeot Citroen. The newspaper did not cite anyone.
Hammerson Plc climbed 9.6 percent to 435 pence. The U.K. property developer that co-owns London’s Brent Cross shopping center plans to raise about 584 million pounds by selling shares in a rights offer to avoid breaking bank agreements.
To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net.
Posts
No comments:
Post a Comment